Donald Trump fired a series of tariffs against Canada, Mexico and China on Saturday, launching a fresh global trade war.
The countries vowed to return to their own tariffs, setting a stage for the economic war that would dress in markets in the coming weeks.
What did he announce now and why?
Washington discovered 25 percent of tariffs to most imports from Canada and Mexico, and an additional 10 percent of imports from imports from China. The Canadian oil is affected by a lower speed of 10 percent. Duties will enter into force from Tuesdays.
Trump said the actions are a response to a “great threat” that represents the flow of migrants and drugs in the US through its borders with Canada and Mexico.
A few years ago, China broke the entities exporting Fentanil to North America. But Chinese groups responded to the shipping of chemical ingredients – called prekursor drugs – into Mexican cartels. The cartels then produce Fentanil and send it across the border where he became the leading American killer between the ages of 18 and 45.
Beijing agreed to take actions to stop the precursor flow on the summit between Chinese President XI Jinping and then President Joe Biden in San Francisco 2023. Critics want China to do much more.
Trump accused the Chinese Communist Party for subsidizing and the incentive of domestic companies on the export of fental and precursor on Saturday.
How did Canada, Mexico and China react?
Canadian Prime Minister Justin Trudeau on Saturday night announced a 25 percent $ 155 billion tariff retaliation ($ 107 billion in USD).
He said that “far -reaching tariffs” would hit us beer, wine, bourbon, fruit, fruit juices, perfume, clothing, shoes, household devices, sports equipment, wood and plastic.
He added that Ottawa also considered “non-Tariff measures” relating to critical minerals, in cooperation with the provincial governments.
Mexico also announced that he would impose tariff retaliation on American goods without citing size or goals.
China has not yet made it clear that she will respond to actions. Beijing said on Sunday that “he firmly complains and opposes this move” and that he will need “the necessary countermeasures to defend his rights and problems”.
In the first 11 months of 2024, US companies made $ 763 billion in three countries – with 17 percent of total exports going to Canada, 16 percent in Mexico and 7 percent in China.
Mexican president Claudia Sheinbaum He hinted at Tariff’s retaliations late last year after Trump’s initial threats. People familiarize this question say that the country has prepared what it calls the “Carusel” tariffs in which they produce months to target and exclude the intended for Republican laws.
During the 2018 dispute in Trump’s first term, Mexico targeting steel and agricultural products such as pork, apple and cheese.
Which industries will be affected?
Car manufacturers, food producers and construction-which largely rely on the cross-border trade-medium industry are the worst affected.
AND American auto industryParticularly traditional “big three” Ford, General Motors and Stellantis, has expanded production in all three countries on the continent. American car suppliers also produce goods in Mexico, from seats to axles. About 16 percent of the US car value was made from a job done in Mexico or Canada.
Car manufacturers with operations in Mexico and Canada will face the absorbing costs or increasing prices for consumers. Import tax could be given a competitive incentive of the South Korean and Japanese car manufacturers sold in the US market, said Daniel Roeska, analyst from Bernstein.
Imports of food from Canada and Mexico will be hit strongly. The United States introduced more than $ 45 billion to Mexico in 2023, according to the American Department of Agriculture, including strawberries, raspberries, tomatoes and beef. Another $ 40 billion has arrived from Canada, including beef, pork, cereals, potatoes and canols.
Building materials will also face pressure, with about a third of a soft wood wood that is used in the United States imported from Canada. Canada and Mexico also make up more than a fifth of American cement import.
“A large part of the increase in the costs caused by tariffs will be transmitted by US consumers,” said James Knightley, an International Economist from ING.
What is omitted?
The Canadian oil industry was spared the worst Trump tariffs, carved by a 10 -pointed tax, as the White House sought to limit the inflation influence on US drivers.
Now they rely on the import of raw oil to feed their refineries, and about 40 percent of raw oil oil comes from abroad – of which, 60 percent come from Canada and 11 percent from Mexico. A significant increase in the cost of imports of raw oil would be felt at the pump.
Chet Thompson, head of US fuel manufacturers and petrochemicals, a refinement group, said he hoped that the contract was “quickly reached” to end all tariffs on the industry “before consumers feel the impact.”
The announcement on Saturday did not mention the EU, but Trump said the previous day that he “absolutely” planned to target a block with new levies in the future. “We’ll do something very significant with the European Union,” he said.
How long will this take?
The White House said the US tariffs would remain in place “to [immigration and drug] The crisis is mitigated ”. But analysts said they had tested the scope of presidential powers and that they would probably be challenged in court.
Trump used the Law on International Emergency Economic Powers of 1977 (IEEPA) to apply tariff, marking the first time the law was used to apply a levy to countries.
“This move is not just an aggressive tariff action in size and extent, but it is also an aggressive statement of presidential power to impose that tariff,” said Greta Peisch, a partner at Law Firm Wiley Rein and former US government trade counselor. “Once again, he broke the new country and tests the boundaries of trade bodies that Congress has delegated.”
Trump threatened to apply wide tariffs to Mexico in 2019 for immigration issues, referring to Ieep, but in the end he did not use them. Richard Nixon used a predecessor for Ieep, trading an enemy rank of 1917, to briefly apply a 10 percent tariff to US trade partners.
